You can file in California as a disregarded entity. Since you live in a community property state half of the business belongs to your wife under those rules.
The purpose in filing two Schedule Cs for the Federal is if there is income and Social Security and Medicare tax is paid on the income by filing two Schedule Cs each person gets credit for the amount paid of Social Security and Medicare tax paid on the income for the Schedule C that is filed using their Social Security number.
What is a Qualified Joint Venture?
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